Cloud Computing Adoption: A Cross-Continent Overview of Challenges

Abstract

Adopting a cloud ERP system instead of a traditional Enterprise Resource Planning (ERP) system promises improved flexibility, improved business efficiency and reduced IT costs. However in spite of these benefits some companies are not adopting cloud ERP systems. In emerging markets such as Africa the adoption rates are much lower than the rest of the world. One reason for non-adoption of cloud ERP systems could be due to misperceptions regarding the benefits and drawbacks of cloud ERP systems. Whilst cloud computing can reduce the environmental impact of traditional ERP systems, the increased size of datacentres require high energy usage. The purpose of this paper is to propose a model of the perceived benefits and drawbacks of cloud ERP systems which is derived from an extensive review of the literature. The model is then verified by means of a survey of South African companies. The results show that security and strategic risks are the most frequently reported drawbacks of adopting a cloud ERP system whilst increased flexibility and collaboration are strong reasons or benefits for adopting them. A more in depth understanding of the perceptions of cloud ERP systems by organisations in South Africa is obtained through this study.